Inheirtance tax of 10%

All inheritance is unearned

The opposite! I am paying huge amounts of tax on my earnings so I would like to give it away to who I want on departure and not then be subject to some ridiculous tax that ultimately means my original earns have been taxed at an effective rate of c75%. The UK is a real outlier on IHT

Despite all the economic research on the proven failure of increased high tax measures across the board to improve living standards and growth, this stupid government is determined to do all the things to kill industry, growth and confidence, led by that massive nob Gary Stevenson, who doesn’t actually know the basic difference between assets and income

All inheritance is unearned

The opposite! I am paying huge amounts of tax on my earnings so I would like to give it away to who I want on departure and not then be subject to some ridiculous tax that ultimately means my original earns have been taxed at an effective rate of c75%. The UK is a real outlier on IHT

Despite all the economic research on the proven failure of increased high tax measures across the board to improve living standards and growth, this stupid government is determined to do all the things to kill industry, growth and confidence, led by that massive nob Gary Stevenson, who doesn’t actually know the basic difference between assets and income

10% on everyone certainly seems fairer than 40% on ‘some’.

How long before the lefties demand that inheritance be taxed at the recipient's marginal tax rate, plus national insurance

But when you apply for probate you have to give the value of the estate, so what would change?

But it’s not. Because it means those with millions pay much less than they should be paying.

10% on everyone certainly seems fairer than 40% on ‘some’.

Does it really affect the squeezed middle more than other groups? Receiving an inheritance is not a given and if i am the beneficiary of a £100k estate, tax of £10k is paid I receive £90k.

Will the royal family still be exempt?

If they had £9 million they had ample time to give some away and still keep enough for possible care fees.

IHT is a tax on hoarding. Don't hoard, and you'll pay much less.

there would be a considerable change in amount of paperwork to be submitted if all estates (except the very small) paid 10% IHT.

Will they be exempt. We don’t know

@Philgooglemail

It's not illegal, and would take concerted agreement across the governments of different countries to address. Being part of a big powerful block like the EU may make it easier to put rules in place to reduce such practices, but the clever people of the UK decided against that.

Irrelevant point because the EU hasn't tackled it.

I’ve maintained this is a good idea for a long time - a flat tax above a certain minimum amount. Loads of people, for some daft reason, think they’ll have to pay IHT (or rather an estate they’re due to inherit from will). The truth is the vast majority will not. So if they ‘think’ they’ll get hung for 40% (and won’t) why not reduce it to 10% (and actually have them pay it). Improves the tax take and sounds like a 75% reduction to those who won’t even realise they’d never have paid it in the first place under the current system.

I think you're referring to the Laffer curve. The idea that lowering tax rates encourage people to work harder, and also to not avoid tax, so the total tax take goes up.

It's a nice idea but has been comprehensively demolished, it's simply not true, it doesn't happen.

Tax rates went up under the Tories (mainly due to higher vat rates and also fiscal drag, where the boundaries between tax rates don't go up with inflation). Under your suggestion that should mean the total tax went down... It didn't. Total tax as a percentage of GDP hit it's highest ever level under Sunak to be fair to the Tories it's scheduled to continue rising under labour.

The reason for this is twofold (1) GDP growth under the Tories was terrible. The economy barely grew due to their policy of austerity. And the disaster of Brexit of course. And (2) we have an ageing population. 20% of government spend goes in the state pension and 25% on the NHS which are both related to the elderly. Bothe of these are paid out of current taxes and are rising fast. Benefits to immigrants and unemployed "scroungers" are tiny in comparison.

We basically need more working age people paying taxes to finance these 2 big drains. As women in the UK are having 1.5 children we need to significantly increase immigration to compensate. Genuinely loosening immigration controls would be the most sensible thing Burnham could do for the economy. But of course he won't because of all the Reform loons.

Whilst I think Burnham is not going to be the answer to anything really I have heard that he is thinking of scrapping inheirtance tax and just putting 10% on everyone’s estate. I don’t think this is bad idea at all.

The very rich don’t pay very much if anything and clearly 10% on a £100k estate is not a huge amount and it just seems fairer if this happens. No 7 year rule, no trusts, no complicated set ups.

Anyone think it’s really going to happen?

How much will it really raise?

IHT is very newsworthy but fiscally irrelevant for the country and for most people. It raises only 0.5% of the UK's total tax take and the vast majority of people don't pay it. For a married couple with a house, the 2nd spouse to die will only pay it on assets above £1m. Given that a few years in a care home will cost you £70k+ per annum per person, even moderately well off people are unlikely to have an estate worth of £1m+ when they die.

Given this I always find it surprising how worked up the right wing press get about IHT. I think it plays well with people who think that the left wing are out to take everyone's hard earned money. (Not true by the way, total tax as a percentage of GDP rose to their highest levels under the Tories, even for the very rich, VAT rising 20% under Osborne was extremely significant)

Taxes aren't really about raising money that the government can then spend - that's not how an economy works, the government has to spend money to put money into the economy first, then most of it comes back via taxes. Taxes are principally a way of encouraging or discouraging certain behaviours. Think cigarette and fuel duty. Progressive income tax rates are a way of encouraging poorer people to work and be productive, but stopping too much wealth concentration at the top (rich people actually spend a smaller proportion of their wealth, cash in the bank isn't good for the economy).

So with IHT you actually want wealthy older people to not hoard their wealth. Piles of cash in the bank are bad for the economy it should be out in the economy cycling round. An elderly couple in a huge house blocks a house that could be better used by a younger bigger family.

So actually I think the current regime with quite a high rate is OK. If it encourages people to trade down their property, give some of their wealth to their kids when it's most useful, buy an annuity that is in turn invested in companies, then it's achieving the right aims..

Of course you'll never get a proper discussion like this, politics and the media has largely been reduced to sound bites. Read the FT or The Economist if you want to understand stuff like this in detail.